No. It would encourage the rich to buy up more properties as business (income property), so they can squeeze more from the middle class by charging rent. The tax is designed to give more to the rich and cut the funding from school. So we continue to create more idiots who believe in the trickle down theory. That's OK. We still get more talents who can create the products that are in demand from abroad. Guess what? The iPhone is designed mostly by the foreigners in US. And iPhone is made in China. So most foreigners are pretty rich. Even though the school doesn't have any funding, the public schools in their neighborhood are pretty well funded. You wonder why?

The tax is designed to give more to the rich and cut the funding from school. ... Even though the school doesn't have any funding, the public schools in their neighborhood are pretty well funded. You wonder why?

It may cause prices to level off for a while, but they won’t crater unless the economy really dives hard or The Plague kills off a significant percentage of the population. There are too many people for too few houses and that’s not changing. It’s getting worse.

CA is already ultra expensive. No deductions for state and local taxes + no deduction for mortgages = one more round of tightening screws. It may encourage a good number of people to conclude it's not worth it, and move to greener pastures. Literally greener.

The tax bill at this point lets expensive private schools be paid from tax free savings accounts while eliminating tax deductions for property taxes which are mostly for public schools. So yes that statement is true unless the reconciliation committee does something really unexpected.

Mortgage Interest Deduction. Currently, if you itemize your deductions, you can deduct qualifying mortgage interest for purchases of up to $1,000,000 plus an additional $100,000 for equity debt. The $1,000,000 cap applies to a mortgage on your primary residence plus one other home.

Under the House bill, current mortgages would be grandfathered - meaning they won't be affected - but new mortgages would be capped at $500,000 for purposes of the deduction. Additionally, the deduction would only apply to your primary residence.Under the Senate bill, the deduction would remain in place for mortgages up to $1,000,000 but the deduction for equity debt (meaning re-fis not related to improving your home) would be eliminated.

Property Tax Deduction. Currently, if you itemize your deductions, you can deduct state and local property taxes. Under both the House and Senate bills, the property tax deduction would remain in place but would be capped at $10,000.

These sound like good moves to me. Houses are too expensive in California.

The tax bill at this point lets expensive private schools be paid from tax free savings accounts

Which "tax free savings accounts" are we talking here? The only education-realeted tax advantaged savings account (only gains are not taxed, not the contributions) whihc can be applied to private school I'm aware of is Coverdell ESA. Which has a contribution limit of $2K per student per year. Good luck paying for $15-30K per year private school with that. Is there anything else I might not be aware of? I would be glad to take advantage of it.

while eliminating tax deductions for property taxes which are mostly for public schools. So yes that statement is true unless the reconciliation committee does something really unexpected.

Eliminating tax deduction does non reduce taxes flowing into local schools from property taxes. You pay it regardless of the fact you can or can't deduct them from the FIT. So this argument is bogus, sorry.

I have found that most lifer renters are completely oblivious to existing tax benefits anyway. They are stubborn about absolutely needing large cash down payments, a sale price cap that fits their own idea of what a house should cost or what was acceptable a half century ago, misplaced anxiety about price trajectory, or any other reason that supplants a self realization that they just can't afford to live in CA.

For example, there is a user on this board who once left CA, was worried about price trajectory of cheap housing in GA (rent vs. buy), yet admits to an income of $450k per year (firmly in the top 1% of society). People are just plain ridiculous, and will do whatever they believe to be logical.

It'll slow the rate of price appreciation a little but won't cut prices.There would have to be a pretty mass exodus of middle and upper middle class people from CA to cause a price drop. $2-3K increase in tax isn't going to do that.

Interest rates going up would have a bigger impact on house prices, but even that does not stop people from buying their own home. As long as there is a shortage of homes, there will always be someone able and willing to bid up the price. That, my friends, is what results in higher prices. All else is just noise that should be ignored.

For example, there is a user on this board who once left CA, was worried about price trajectory of cheap housing in GA (rent vs. buy), yet admits to an income of $450k per year (firmly in the top 1% of society). People are just plain ridiculous, and will do whatever they believe to be logical.

LOL, you talking about me anonymous? Yes, I left CA after deciding that $550-800k for a shit shack was too much to burn on a box. As for GA, I bought a really nice house out here for $250k, while at the time concerned about housing trends (I was here during the last bubble) - which may be what you're referring to. (Hint: I don't like losing $$)

My plan is to retire at 37. Please explain how my decisions are ridiculous. Leaving CA was by far one of the best decisions I've made in life. I'm just another average joe, trying to play my cards right so that I'm not working my ass off for someone else at 50/60 years old.